Forrester Research, Inc. (FORR): SWOT Analysis [Nov-2025 Updated]

You need to know if Forrester Research, Inc. (FORR) is a smart bet right now. They've built a powerful, trusted brand with an impressive annual contract value (ACV) retention rate historically hovering near 90%, giving them solid, recurring revenue. But, to be fair, they are facing a real challenge: their 2025 revenue projection of around $510 million shows modest growth as they fight the scale of Gartner and the defintely increasing threat of free, AI-powered research platforms. We'll map out their strengths, weaknesses, and the clear actions they must take to capitalize on the GenAI strategy opportunity.

Forrester Research, Inc. (FORR) - SWOT Analysis: Strengths

Deep expertise in customer experience (CX) and B2B technology research.

Forrester Research, Inc. is a recognized authority, especially in the realms of Customer Experience (CX) and B2B technology strategy. This is a core strength that keeps the brand relevant to executive-level decision-makers, even during economic slowdowns. We saw this expertise solidify in mid-2025 with the launch of the Total Experience Score, which combines the established Customer Experience Index (CX Index™) with the new Brand Experience Index (BX Index™) to give clients a holistic view of their market standing.

The firm is actively expanding its research, introducing new streams like the buying networks research series for B2B markets. Plus, the quick rollout of Forrester AI Access in Q3 2025, a self-service generative AI offering, shows their ability to rapidly productize their deep knowledge base and stay ahead of the curve.

Strong brand equity and trust with Fortune 500 decision-makers.

The company's brand equity is defintely a major asset, giving them a seat at the table with the world's largest companies. Honestly, this trust is hard to replicate. As of 2025, Forrester serves a significant portion of the top tier, specifically 61% of Fortune 100 companies. This deep penetration into the largest enterprises provides a stable foundation for revenue, even when clients are tightening their budgets.

This high-level access means Forrester is often advising on mission-critical, multi-million dollar projects, which locks in long-term relationships and higher contract values. The fact that their research and advisory services are the basis for major corporate decisions is a powerful competitive moat.

High-value subscription model provides predictable, recurring revenue.

The shift to the flagship Forrester Decisions platform has cemented a high-value subscription model, which is the engine of the business. Approximately 80% of the company's total contract value (CV) is now concentrated in this platform. This subscription focus makes revenue more predictable than a pure consulting model.

In 2024, research revenue accounted for approximately 73% of total revenue. This structure allows for strong operating margins in the research segment, which reported $52.9 million in operating income for Q3 2025. The move to multi-year deals also helps, with the percentage of contract value in multi-year agreements growing from 62% to 69% at the end of 2024.

Consulting services complement research, driving up total contract value.

The consulting segment acts as a high-margin accelerator, translating generic research insights into custom, actionable strategies for clients. This complementarity drives up the total value of each client relationship. Consulting revenue for Q3 2025 was $21.5 million, demonstrating its material contribution to the overall business, even as it faces short-term headwinds.

While consulting and events together made up less than 30% of the overall revenue mix in 2024, the consulting business has shown particular strength in strategy consulting bookings. This segment is crucial because it allows the sales team to enrich client accounts by moving beyond the initial research subscription, which is a key growth lever for the company.

Reported annual contract value (ACV) retention rate historically hovers near 90%.

Client retention is the lifeblood of any subscription business. Forrester uses a key metric called wallet retention, which measures the contract value retained from existing clients, and it has historically been very strong. While the company is navigating a challenging economic environment in 2025, this metric remains at a healthy level.

Here's the quick math on recent retention metrics:

The wallet retention rate of 86% in Q3 2025 is still a solid number for a high-cost advisory service, even if it's down slightly from the 89% seen at year-end 2024. This sticky client base, where the average contract value per client is increasing, shows the underlying strength of the value proposition.

Forrester Research, Inc. (FORR) - SWOT Analysis: Weaknesses

Smaller scale compared to industry giants like Gartner, limiting market reach.

Honestly, the biggest headwind for Forrester Research is simply its size relative to the market gorilla, Gartner. This isn't just about bragging rights; it's a structural disadvantage that limits Forrester's ability to cover every niche and drive global influence. Gartner's scale allows it to dominate mindshare, especially with enterprise Chief Information Officers (CIOs).

Here's the quick math on the competitive gap. In 2022, Gartner's technology research revenue was approximately $3.6 billion, while Forrester's total revenue was about $537 million. That's a revenue gap of over six-to-one. Plus, Gartner boasts over 1,700 analyst experts, whereas Forrester has closer to 600. That difference means Gartner can offer a deeper, broader coverage map, which is what large, complex clients defintely need.

High cost of research production and analyst salaries pressures operating margins.

The research and advisory business is fundamentally a people business, which means high fixed costs, primarily analyst salaries. Forrester's model requires top-tier experts, and those experts command a premium. For instance, a Data Analyst at Forrester can earn an average of $155,000 annually, which is well above the US average for that role. This high cost base is a constant pressure point on profitability.

The crunch is visible in the margin projections. For the full fiscal year 2025, the company projects an adjusted operating margin between 7.5% and 8.5%. To be fair, that's an improvement from the 2024 GAAP operating margin, but it's still a tight window. When revenue is declining, as it is now, every dollar of fixed cost eats into that margin, making it hard to fund new growth initiatives or compete on price.

Dependence on the flagship Forum events for significant near-term revenue spikes.

Forrester's event business, primarily the Forum events, has historically provided significant, high-margin revenue spikes. The problem is that this segment is highly susceptible to economic downturns and corporate travel restrictions, making it volatile. The recent performance shows this vulnerability clearly: event revenue fell 23% year-over-year in Q2 2025, dropping to just $10.2 million for the quarter. For the full year 2024, event revenue declined a staggering 34%. That's a huge drag.

This reliance on events creates a lumpy revenue stream. When the events segment struggles, the entire top line feels the pain, and it's a difficult area to forecast reliably in an uncertain macroeconomic environment.

Slow-to-adapt digital product strategy compared to agile, data-first competitors.

While Forrester has made a major push with its new flagship platform, Forrester Decisions, and its generative AI tool, Izola, the firm was arguably slow to transition to a truly digital-first, data-driven product delivery model. The multi-year transition meant a period of internal focus when competitors were already innovating. The good news is that 80% of the company's Contract Value (CV) is now on the Forrester Decisions platform, showing the shift is underway.

Still, the lag allowed smaller, more agile competitors and crowdsourced review platforms to gain ground. The company is now playing catch-up in areas like real-time data analytics and seamless user experience, which is a tough spot to be in when client retention is already under pressure, with wallet retention declining to 85% in Q2 2025 from 88% a year earlier.

Revenue for the 2025 fiscal year is projected to be around $395 million to $405 million, a modest growth rate.

The financial reality for the 2025 fiscal year is a significant weakness, as the company is projecting a revenue decline, not a modest growth rate. The official guidance for full-year 2025 total revenues is approximately $395.0 million to $405.0 million. This represents a projected decline of 8.7% to 6.4% versus the prior year's revenue of $432.5 million. This decline is a clear signal of ongoing macroeconomic pressure and challenges in client retention and new sales execution.

This projected revenue contraction is the clearest near-term risk. It forces management to prioritize cost controls, like the workforce reduction of approximately 6% in late 2024, over aggressive investment in growth, which can further compound the scale disadvantage against Gartner.

• Projected 2025 Revenue: $395 million to $405 million.
• Projected Revenue Change: Decline of 6.4% to 8.7% year-over-year.
• Contract Value (CV) Decline: Down 7% to $288.1 million in Q3 2025.

Finance: draft a 13-week cash view by Friday, assuming the low end of the 2025 revenue guidance to stress-test liquidity.

Forrester Research, Inc. (FORR) - SWOT Analysis: Opportunities

The biggest opportunities for Forrester Research, Inc. right now are in leveraging their deep research base to capture high-margin, recurring revenue from the explosive growth in Generative AI (GenAI) and by finally pushing hard into high-growth international markets. The transition to the Forrester Decisions platform is largely complete, so the focus shifts to maximizing client value and geographic reach.

Expand into high-growth, specialized markets like AI governance and GenAI strategy consulting.

You have a clear path to higher-margin business by positioning Forrester Research as the definitive source for AI governance and strategy. The global AI Governance market is projected to reach USD 309.01 million in 2025, with a compound annual growth rate (CAGR) of 35.74% from 2025 to 2034. That is a massive tailwind. The broader AI consulting market is expected to increase by USD 38.16 billion with a CAGR of 28.8% from 2024 to 2029. Forrester's existing GenAI tool, Izola, and the new self-service offering, Forrester AI Access, are the right products to capture this demand. The market is moving from experimentation to strategic scaling, and companies need help to avoid failure; 25% of enterprises using GenAI are forecast to deploy AI agents in 2025, but 60% of initiatives fail to scale. Your expertise can close that gap. This is a defintely a high-priority, near-term revenue driver.

Increase wallet share by cross-selling Forrester Decisions and Forrester Connect platforms.

With roughly 80% of your Contract Value (CV) now migrated to the Forrester Decisions platform, the heavy lifting of the product transition is done. The next step is 'enrichment,' which means selling more to existing clients. Your wallet retention rate was 86% in Q3 2025, which is solid, but there is headroom to push that closer to 100% and beyond. You already proved this model works, increasing the contract value per client by 10% to $158,000 at year-end 2024. Cross-selling Forrester Connect (events) and high-touch consulting to your core Forrester Decisions clients is the quickest way to boost revenue without the high cost of acquiring new logos.

Here's the quick math on the opportunity:

Strategic acquisitions of smaller, niche data providers to bolster data-driven insights.

Your last major acquisition was SiriusDecisions in 2018. In a market where competitors are constantly buying up niche data and AI startups, a lack of recent M&A activity is a missed opportunity to immediately inject new capabilities. You had cash reserves of $135 million in Q2 2025 and only $35 million in debt, giving you a strong balance sheet for targeted, tuck-in acquisitions. Acquiring a provider specializing in real-time data or a vertical-specific GenAI data set could immediately bolster your research offerings and justify higher subscription prices.

Grow international market penetration, especially in APAC and EMEA regions.

The growth outside of North America is a clear, uncaptured opportunity. The Asia Pacific (APAC) technology spending market alone was initially projected to grow by 6.5% in 2025 to reach US$722 billion. More specifically, the software market in APAC is set to grow 10.4% in 2025, which is exactly where Forrester Research's core offerings sit. You need to aggressively target these high-growth pockets:

• Indonesia: Tech spending growth of 8.5% in 2025.
• Philippines: Tech spending growth of 9.4% in 2025.
• Vietnam: Tech spending growth of 10% in 2025.

A more focused sales and marketing investment in these regions, backed by localized research, can capture a meaningful share of this multi-billion dollar market. You have the global presence; now you need to fund the execution.

Convert more consulting engagements into higher-margin, recurring subscription revenue.

Your full-year 2025 revenue guidance of $395.0 million to $405.0 million is a decline from 2024, and your consulting business saw an 8% revenue decline in Q3 2025. This volatility is exactly why you need to push clients from one-off consulting projects into sticky, recurring subscription contracts. Research accounted for approximately 73% of total revenue in 2024, and that recurring base is the foundation of your business. By structuring consulting projects-especially those around GenAI strategy-to include a mandatory, multi-year subscription to the relevant Forrester Decisions service, you can stabilize and grow the top line.

Forrester Research, Inc. (FORR) - SWOT Analysis: Threats

Aggressive competition from Gartner, which dominates the technology advisory market.

The competitive landscape is defintely a David-and-Goliath situation, and it's the biggest threat to Forrester's top-line revenue. Gartner is the market gorilla. To put it in perspective, Gartner's 2022 technology research revenue was approximately $3.6 billion, while Forrester Research's total revenue for the full year 2024 was only $432.5 million. That size difference gives Gartner a massive advantage in sales reach, brand recognition, and the ability to bundle services at scale. Forrester is guiding for full-year 2025 revenue between $395.0 million and $405.0 million, a decline of up to 8.7% from the prior year, showing they are actively losing ground in a tough market. This isn't a fair fight; it's a battle for niche relevance.

Here's the quick math on the competitive gap:

Rise of free or low-cost, AI-powered research and self-service data platforms.

The democratization of data through generative AI (Artificial Intelligence) is a direct threat to the subscription model of traditional analyst firms. Why pay a premium for a report when a sophisticated AI tool can synthesize similar insights from vast public and proprietary datasets almost instantly? The market is shifting fast: 83% of organizations plan to significantly increase their AI investment in 2025, and 89% of market researchers are already using AI tools regularly. Plus, 71% of market researchers believe synthetic data will account for over half of all data collection within three years.

Forrester is trying to adapt by launching Forrester AI Access, a new self-service offering that uses their own generative AI capabilities. Still, this move risks cannibalizing their high-margin, human-led research and advisory services. The threat isn't just new competitors; it's the technology itself making the old model obsolete. They're trying to outrun a tidal wave.

Economic downturns directly impact client spending on discretionary research and consulting.

When the economy tightens, research and consulting are often the first line items that Chief Financial Officers cut because they are seen as discretionary spending. This threat is already visible in Forrester's 2025 results. The company's management cited ongoing market uncertainty as a key factor impacting their Contract Value (CV), which was down 7% to $288.1 million as of Q3 2025. Their full-year 2025 revenue guidance reflects this pressure, projecting a decline of up to 8.7% compared to 2024. The decline in their events segment revenue was particularly sharp, falling 42% in Q4 2024, a clear sign that clients are pulling back on non-essential spending like travel and conference attendance.

The financial impact of client spending cuts is clear:

• Q1 2025 Revenue: $89.9 million, a 10.2% decline from Q1 2024.
• Q2 2025 Revenue: $111.7 million, an 8.3% decline from Q2 2024.
• Q3 2025 Revenue: $94.3 million, down from $102.5 million in Q3 2024.

High analyst turnover risks losing proprietary knowledge and client relationships.

Forrester's value is fundamentally tied to the expertise of its analysts and the deep, personal relationships they hold with clients. High turnover means those relationships and the proprietary knowledge walk out the door. While a specific analyst turnover rate for 2025 is not published, the company's actions signal a problem. Management has made improving retention one of its three core priorities for 2025. Also, the company's headcount was down 12% in Q2 2025 compared to the same period in 2024. This reduction, while partly a cost-control measure, exacerbates the risk of overburdening remaining staff and further eroding the personal touch that justifies the high cost of their advisory services. Client retention, a key metric, stood at 74% in Q2 2025, which means one in four clients are choosing not to renew their subscriptions over a period of time. That's a churn rate that needs urgent attention.

Increased scrutiny on research quality and methodology defintely impacts credibility.

The rise of free and AI-generated content puts immense pressure on the perceived value and quality of paid research. For a research firm, credibility is everything. The most concrete evidence of a threat to their valuation and market perception in 2025 is the Q1 2025 non-cash goodwill impairment charge of $83.9 million. This charge signifies that the value of past acquisitions on their balance sheet is now considered lower, often due to a sustained decline in the expected future cash flows of the business. It's a financial admission that the market value of their intangible assets-like brand and methodology-has been seriously challenged. This financial hit directly impacts investor confidence and suggests a fundamental reassessment of the long-term value of their traditional business model.

What this estimate hides is the internal pressure to transition from a traditional analyst model to a more scalable, digital-first platform. That transition is expensive, plus it creates internal friction. Your next step should be to look closely at their capital allocation-specifically, how much is going into product development versus sales and marketing.

Finance: Analyze FORR's Q3 2025 CapEx report for digital transformation spend by Friday.